Spain Goes From Bad To Worse

Despite the world and their lemur believing that, with a self-referential EUR100 billion bailout (loan) for its banks and a ponzi guarantee scheme for its insolvent regions, all will be well and more debt fixes too much debt, Spanish 10Y yields are back near 7% and spreads over 575bps. The reason - simple - the backbone of their credit-fueled economic growth has crumbled and is now crumbling faster.

"This government can't decide between a good and a bad choice," Mr. Rajoy said. "This government has to choose between the bad and the even worse." 

Since the EU Summit, and basically month-to-date, Spanish 10Y spreads are 100bps wider back near record wides... 

and Spanish bad loans are rising at an extremely high pace and for 14 months in a row...

........................ Tyler Durden